Tuesday’s Bloodbath on Wall Street

Earn While You Learn! ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ [EARN WHILE YOU LEARN! JOIN OUR FREE LIVE TRADING SESSION!]( Hello investor, Tuesday’s Bloodbath on Wall Street Yesterday was a brutal day for the stock market. Wall Street already knew that September was historically the worst-performing month. Stocks plunged immediately on its first day of trading in September. The catalyst was a report showing that manufacturing activity shrank in August for the 5th straight month. Traders didn’t react much in previous reports. This time, they ran for the exit door. Nvidia fell 9.52% for the day. Other chipmakers also had a bad day. Oil prices wiped out all of their 2024 gains on demand concerns. Falling inflation was positive for the Federal Reserve’s goal of taming price gains. However, investors are starting to think that lower inflation may be due to cooling demand. The question shifts to whether the Fed can cut rates in time to prevent a recession. This makes Friday’s payrolls data even more important. It might determine the size of the rate cut during the next FOMC meeting. A cooler-than-expected report may lead to a 50 basis-point cut. - “This week’s jobs report, while not the sole determinant, will likely be a key factor in the Fed’s decision between a 25 or 50 basis-point cut,” said Jason Pride and Michael Reynolds at Glenmede. - “Even modest signals in this week’s jobs report could be a key decision point as to whether the Fed takes a more cautious or aggressive approach.” Economists expect payrolls to increase by about 165,000. It would be higher than the 114,000 gain in July. The unemployment rate is expected to fall to 4.2% from 4.3%. So, the expectations are for August to show better numbers than July. Bulls really need Friday’s jobs data to reassure investors of the economic health. A stronger-than-expected number can spark a recovery. Right now, Wall Street expects the Fed to cut interest rates by a full percentage point by the end of the year. Meaning? There might be a 50 basis-point cut at one of the last three meetings left in 2024. The Fed is unlikely to go for a jumbo-sized cut unless they believe the economy is cooling rapidly. So, Wall Street might hint that it expects the economic health to deteriorate. Top Recession-Proof Stock To Buy Right Now Today’s Stock Pick: BJ's Wholesale Club Holdings Inc (BJ) The financial crisis during 2007-09 was brutal, but not all stocks were biohazardous to own. Take a look at the top 10 stocks in the S&P 500 by total return during that year: What did you notice? Three of the top 10 stocks were discount stores – Dollar Tree, Walmart, and Ross Stores. When the economy goes into the toilet, consumers often become budget-conscious and start shopping for value. Hence our pick for BJ’s Club. Want an astonishing example? Let’s look at BJ’s fuel business. If you’ve attended a store, you probably noticed a gas station attached to the store. Customers love BJ’s fuel because it is often cheaper than a traditional fuel station. For example, the average C-store sells about 1.5 million to 2 million gallons per year. BJ’s stations exceed that volume easily and nearly a quarter of its stations can sell four to five times as much as these average C-stores. Membership model: About half of BJ’s revenue came from its annual membership fee. This offers durable earnings during a tough economy. After all, customers might feel inclined to keep their BJ’s Club membership to take advantage of value if things become tougher in the economy. In the recent quarter, BJ’s Club grew its membership fees by 9%. A growing market: BJ’s Club doesn’t have a nationwide presence yet, as it competes primarily in the east coast. It has a major trend on its side. The U.S. warehouse club market size grew steadily since 2009. This is fantastic because BJ’s Club hasn’t tapped into its potential markets yet. It only has 266 clubs across 21 states. That is only 40% of the total states. It dominated New England with three times more clubs than the next largest competitor. (Source: ScrapeHero) This offers great growth potential for BJ’s Club to expand beyond 21 states while the warehouse club market grows robustly. Bottom line: BJ’s Club looks like a perfect stock to own over the next year. Its stock is trading at about 19 P/E which is nearly three times lower than Costco’s ~40 P/E. With consumers looking for value, BJ’s Club is poised to benefit from it. [EARN WHILE YOU LEARN! JOIN OUR FREE LIVE TRADING SESSION!](       © All Rights Reserved, Trade Alliance [Unsubscribe]( | [Manage Preferences](